Another month, another record low for consumer confidence

With housing prices falling, energy prices climbing, and worries of a recession, it’s perhaps no surprise that consumers statewide were feeling even less confident in February than in January. The result: another record low reading for the consumer confidence index compiled by the Siena Research Institute in Loudonville.

“Just when we thought things couldn’t get any worse, they have,” said Douglas Lonnstrom, professor of statistics and finance at Siena College and the institute’s founding director. “Continued talk about a recession coupled with inflation affecting everyday goods has created a perfect storm that is sinking confidence here in New York and across the country.

“Concern about the future has leveled out, but now the problem is today,” he added. “For the first time since we started measuring the index in New York, more consumers are worried and pessimistic than those that are hopeful across every demographic category.”

The overall index fell 2.5 points to 62.4, still 8.4 points below the nation’s index, which lost 7.6 points to fall to 70.8. Th index has two components, current and future confidence. While the future index statewide actually gained slightly, adding 0.4 points to 60.3, current index fell 7.2 points to 65.6.

Nationally, current confidence fell 10.6 points to 83.8, while future confidence was down 5.7 points to 62.4. The Siena survey is modeled on a national survey conducted by the University of Michigan, with the index set at 100 in the base year of 1966.

Some positive trends: A separate part of the survey that measures buying intentions for specific big-ticket items found more people planning to buy homes, up 0.9 points to 4.0 percent, and cars and trucks, up 1.6 points to 10.1 percent. But computers and furniture were down, and the percentage of consumers planning to make major home improvements remained unchanged.

Republicans, higher-income respondents and men remained the most confident, while lower-income respondents, women and upstate residents were the least confident. The survey was conducted by making random phone calls to 622 New York residents over the age of 18.

Economists follow consumer confidence closely because it seeks to measure the willingness of consumers to spend, and that spending makes up more than two-thirds of the nation’s total economic activity.